Data Storage (NASDAQ:DTST) Releases Quarterly Earnings Results, Misses Expectations By $0.24 EPS

Data Storage (NASDAQ:DTST) posted its quarterly earnings data on Friday. The company reported ($0.53) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.29) by ($0.24), Zacks reports. The company had revenue of $0.36 million for the quarter, compared to analyst estimates of $0.40 million.

Here are the key takeaways from Data Storage’s conference call:

• Nexxis revenue from continuing operations rose 9.3% year over year to $359,000, while gross profit increased 21.9% to $168,000 and gross margin improved to 47% from 42.1%, supported by new customers, higher existing-customer spending, favorable mix, and operating leverage.
• Data Storage ended the quarter with approximately $9.3 million in cash and marketable securities and no long-term debt, providing flexibility to pursue acquisitions, strategic investments, and internally developed initiatives.
• The company’s net loss attributable to common shareholders widened to $1.2 million from $732,000, as SG&A rose 33.2% to $1.5 million, driven primarily by higher non-cash stock compensation and professional fees.
• Management is evaluating more than 100 potential opportunities across cybersecurity, AI infrastructure, telecommunications, software, and related markets, but remains cautious about unrealistic valuations and is not yet ready to announce a transaction.
• Management said it would like to sign a nonbinding letter of intent within 45–60 days and close an acquisition by late fourth quarter 2026 or the first quarter of 2027, likely using a combination of cash, stock, and earn-out structures to limit risk and align seller incentives.

Data Storage Trading Down 14.5%

NASDAQ:DTST traded down $0.52 during trading hours on Friday, hitting $3.06. 87,873 shares of the company traded hands, compared to its average volume of 13,159. Data Storage has a twelve month low of $2.85 and a twelve month high of $5.15. The firm has a 50-day moving average of $3.32 and a 200 day moving average of $3.81. The stock has a market capitalization of $7.15 million, a price-to-earnings ratio of -9.27 and a beta of 1.15.

Insider Transactions at Data Storage

In other news, CEO Charles M. Piluso sold 32,610 shares of the business’s stock in a transaction dated Tuesday, May 26th. The shares were sold at an average price of $3.82, for a total transaction of $124,570.20. Following the transaction, the chief executive officer owned 223,074 shares in the company, valued at approximately $852,142.68. The trade was a 12.75% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 86,958 shares of company stock valued at $333,310. Company insiders own 21.20% of the company’s stock.

Hedge Funds Weigh In On Data Storage

Several institutional investors and hedge funds have recently added to or reduced their stakes in the company. Dimensional Fund Advisors LP increased its position in shares of Data Storage by 15.1% during the third quarter. Dimensional Fund Advisors LP now owns 37,574 shares of the company’s stock valued at $162,000 after purchasing an additional 4,920 shares during the period. Zacks Investment Management bought a new stake in Data Storage in the 4th quarter valued at $83,000. XTX Topco Ltd bought a new stake in Data Storage in the 4th quarter valued at $134,000. Rothschild Wealth LLC acquired a new position in shares of Data Storage in the 4th quarter valued at $205,000. Finally, Elevation Point Wealth Partners LLC bought a new position in shares of Data Storage during the 3rd quarter worth about $186,000. 11.56% of the stock is currently owned by institutional investors.

Analyst Upgrades and Downgrades

Separately, Weiss Ratings reissued a “hold (c)” rating on shares of Data Storage in a research report on Thursday, July 2nd. Two research analysts have rated the stock with a Hold rating, According to data from MarketBeat.com, the stock presently has a consensus rating of “Hold”.

Data Storage Company Profile

Data Storage Corporation provides data management and cloud solutions in the United States and internationally. It offers a suite of multi-cloud IT solutions, including cyber security solutions, which comprise ezSecurity, a security solution for endpoint security, system assessments, and risk analysis, as well as IBM system protection, including Ransomware defense. The company also provides data protection and recovery solutions, such as ezVault for offsite data protection; ezRecovery for fast data recovery; ezAvailability for real-time data replication with minimal recovery objectives; and ezMirror for data mirroring at the storage level.